Professional Documents
Culture Documents
INTRODUCTION
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CASH MANAGEMENT DEFINITION
Cash management is a marketing term for certain services offered primarily to larger
business customers. It may be used to describe all bank accounts (such as checking
accounts) provided to businesses of a certain size, but it is more often used to describe
specific services such as cash concentration, zero balance accounting, and automated
clearing house facilities. Sometimes, private bank customers are given cash
management services.
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• Armored Car Services: Large retailers who collect a great deal of cash
may have the bank pick this cash up via an armored car company, instead of
asking its employees to deposit the cash.
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• Lockbox: services: Often companies (such as utilities) which receive a large
number of payments via checks in the mail have the bank set up a post office
box for them, open their mail, and deposit any checks found. This is referred to
as a "lockbox" service.
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• Wire Transfer: A wire transfer is an electronic transfer of funds. Wire
transfers can be done by a simple bank account transfer, or by a transfer of cash
at a cash office. Bank wire transfers are often the most expedient method for
transferring funds between bank accounts. A bank wire transfer is a message to
the receiving bank requesting them to effect payment in accordance with the
instructions given. The message also includes settlement instructions. The actual
wire transfer itself is virtually instantaneous, requiring no longer for
transmission than a telephone call.
In the past, other services have been offered the usefulness of which has diminished
with the rise of the Internet. For example, companies could have daily faxes of their
most recent transactions or be sent CD-ROMs of images of their cashed checks.
Cash management aims at evolving strategies for dealing with various facets of cash
management. These facets include the following:
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CHAPTER II
RESEARCH METHODOLOGY
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OBJECTIVES
Objectives of a project tell us why project has been taken under study. It helps
us to know more about the topic that is being undertaken and helps us to explore future
prospects of that organisation. Basically it tells what all have been studied while making
the project.
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Due to non-synchronization of ash inflows and cash outflows the surplus cash
may arise at certain points of time. If this cash surplus is deployed judiciously
cash management will itself become a profit centre.
1. To eliminate idle cash balances. Every dollar held as cash rather than used to
augment revenues or decrease expenditures represents a lost opportunity. Funds
that are not needed to cover expected transactions can be used to buy back
outstanding debt (and cease a flow of funds out of the Treasury for interest
payments) or can be invested to generate a flow of funds into the Treasury’s
account. Minimizing idle cash balances requires accurate information about
expected receipts and likely disbursements.
2. To deposit collections timely. Having funds in-hand is better than having
accounts receivable. The cash is easier to convert immediately into value or
goods. A receivable, an item to be converted in the future, often is subject to a
transaction delay or a depreciation of value. Once funds are due to the
Government, they should be converted to cash-in-hand immediately and
deposited in the Treasury's account as soon as possible.
3. To properly time disbursements. Some payments must be made on a specified
or legal date, such as Social Security payments. For such payments, there is no
cash management decision. For other payments, such as vendor payments,
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discretion in timing is possible. Government vendors face the same cash
management needs as the Government.
RESEARCH METHODOLOGY
Research is a process through which we attempt to achieve systematically
and with the support of data the answer to a question, the resolution of a problem, or a
greater understanding of a phenomenon. This process, which is frequently called
research methodology, has eight distinct characteristics:
Descriptive research is used in this project report in order to know about cash
management services to clients and determining their level of satisfaction. This is the
most popular type of research technique, generally used in survey research design and
most useful in describing the characteristics of consumer behavior. The method used
was following:
Questionnaire method
Direct Interaction with the clients.
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SCOPE OF THE STUDY
1. The allotted time period of 6 weeks for the study was relatively insufficient,
keeping in mind the long duration it can take at times, to close a particular
corporate deal.
2. The study might not produce absolutely accurate results as it was based on a
3. It was difficult getting time and access to senior level Finance/HR managers
(who had to be talked to, to get required information) due to their busy
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CHAPTER-III
INDUSTRYPROFILE
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INDUSTRY PROFILE
Banks are the most significant players in the Indian financial market. They are
the biggest purveyors of credit, and they also attract most of the savings from the
population. Dominated by public sector, the banking industry has so far acted as an
efficient partner in the growth and the development of the country. Driven by the
socialist ideologies and the welfare state concept, public sector banks have long been
the supporters of agriculture and other priority sectors. They act as crucial channels of
the government in its efforts to ensure equitable economic development.
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The Indian banking has finally worked up to the competitive dynamics of the
‘new’ Indian market and is addressing the relevant issues to take on the multifarious
challenges of globalization. Banks that employ IT solutions are perceived to be
‘futuristic’ and proactive players capable of meeting the multifarious requirements of
the large customer’s base. Private Banks have been fast on the uptake and are
reorienting their strategies using the internet as a medium The Internet has emerged as
the new and challenging frontier of marketing with the conventional physical world
tenets being just as applicable like in any other marketing medium.
The Indian banking has come from a long way from being a sleepy business
institution to a highly proactive and dynamic entity. This transformation has been
largely brought about by the large dose of liberalization and economic reforms that
allowed banks to explore new business opportunities rather than generating revenues
from conventional streams (i.e. borrowing and lending). The banking in India is
highly fragmented with 30 banking units contributing to almost 50% of deposits and
60% of advances. Indian nationalized banks (banks owned by the government)
continue to be the major lenders in the economy due to their sheer size and penetrative
networks which assures them high deposit mobilization. The Indian banking can be
broadly categorized into nationalized, private banks and specialized banking
institutions.
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The liberalize policy of Government of India permitted entry to private sector
in the banking, the industry has witnessed the entry of nine new generation private
banks. The major differentiating parameter that distinguishes these banks from all the
other banks in the Indian banking is the level of service that is offered to the customer.
Their focus has always centered around the customer – understanding his needs,
preempting him and consequently delighting him with various configurations of
benefits and a wide portfolio of products and services. These banks have generally
been established by promoters of repute or by ‘high value’ domestic financial
institutions.
The popularity of these banks can be gauged by the fact that in a short span of
time, these banks have gained considerable customer confidence and consequently
have shown impressive growth rates. Today, the private banks corner almost four per
cent share of the total share of deposits. Most of the banks in this category are
concentrated in the high-growth urban areas in metros (that account for approximately
70% of the total banking business). With efficiency being the major focus, these
banks have leveraged on their strengths and competencies viz. Management,
operational efficiency and flexibility, superior product positioning and higher
employee productivity skills.
The private banks with their focused business and service portfolio have a
reputation of being niche players in the industry. A strategy that has allowed these
banks to concentrate on few reliable high net worth companies and individuals rather
than cater to the mass market. These well-chalked out integrates strategy plans have
allowed most of these banks to deliver superlative levels of personalized services.
With the Reserve Bank of India allowing these banks to operate 70% of their
businesses in urban areas, this statutory requirement has translated into lower deposit
mobilization costs and higher margins relative to public sector banks.
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PEST ANALYSIS
TECHNOLOGICAL ENVIROMENT
Today banks are also using SMS and Internet as major tool of promotions and
giving great utility to its customers. For example SMS functions through simple text
messages sent from your mobile. The messages are then recognized by the bank to
provide you with the required information.
All these technological changes have forced the bankers to adopt customer-
based approach instead of product-based approach.
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ECONOMICAL ENVIROMENT
Banking is as old as authentic history and the modern commercial banking are
traceable to ancient times. In India, banking has existed in one form or the other from
time to time. The present era in banking may be taken to have commenced with
establishment of bank of Bengal in 1809 under the government charter and with
government participation in share capital. Allahabad bank was started in the year 1865
and Punjab national bank in 1895, and thus, others followed
Every year RBI declares its 6 monthly policy and accordingly the various
measures and rates are implemented which has an impact on the banking sector. Also
the Union budget affects the banking sector to boost the economy by giving certain
concessions or facilities. If in the Budget savings are encouraged, then more deposits
will be attracted towards the banks and in turn they can lend more money to the
agricultural sector and industrial sector, therefore, booming the economy. If the FDI
limits are relaxed, then more FDI are brought in India through banking channels.
Government and RBI policies affect the banking sector. Sometimes looking into
the political advantage of a particular party, the Government declares some measures to
their benefits like waiver of short-term agricultural loans, to attract the farmer’s votes.
By doing so the profits of the bank get affected. Various banks in the cooperative sector
are open and run by the politicians. They exploit these banks for their benefits.
Sometimes the government appoints various chairmen of the banks.
Various policies are framed by the RBI looking at the present situation of the
country for better control over the banks.
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SOCIAL ENVIROMENT
Before nationalization of the banks, their control was in the hands of the private
parties and only big business houses and the effluent sections of the society were getting
benefits of banking in India. In 1969 government nationalized 14 banks. To adopt the
social development in the banking sector it was necessary for speedy economic
progress, consistent with social justice, in democratic political system, which is free
from domination of law, and in which opportunities are open to all. Accordingly,
keeping in mind both the national and social objectives, bankers were given direction to
help economically weaker section of the society and also provide need-based finance to
all the sectors of the economy with flexible and liberal attitude. Now the banks provide
various types of loans to farmers, working women, professionals, and traders. They also
provide education loan to the students and housing loans, consumer loans, etc.
Banks having big clients or big companies have to provide services like
personalized banking to their clients because these customers do not believe in running
about and waiting in queues for getting their work done. The bankers also have to
provide these customers with special provisions and at times with benefits like food and
parties. But the banks do not mind incurring these costs because of the kind of business
these clients bring for the bank.
Banks have changed the culture of human life in India and have made life much
easier for the people.
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COMPANY PROFILE
18
COMPANY PROFILE
The Standard Chartered Group was formed in 1969 through a merger of two
banks: The Standard Bank of British South Africa founded in 1863 and the Chartered
Bank of India, Australia and China, founded in 1853.
Both companies were keen to capitalise on the huge expansion of trade and to earn the
handsome profits to be made from financing the movement of goods from Europe to the
East and to Africa.
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THE STANDARD BANK
In 1969, the decision was made by Chartered and by Standard to undergo a friendly
merger. All was going well until 1986, when a hostile takeover bid was made for the
Group by Lloyds Bank of the United Kingdom. When the bid was defeated, Standard
Chartered entered a period of change. Provisions had to be made against third world
debt exposure and loans to corporations and entrepreneurs who could not meet their
commitments. Standard Chartered began a series of divestments notably in the United
States and South Africa, and also entered into a number of asset sales.
From the early 1990s, Standard Chartered has focused on developing its strong
franchises in Asia, the Middle East and Africa using its operations in the United
Kingdom and North America to provide customers with a bridge between these
markets. Secondly, it would focus on consumer, corporate and institutional banking and
on the provision of treasury services - areas in which the Group had particular strength
and expertise.
In the new millennium we acquired Grindlays Bank from the ANZ Group and the
Chase Consumer Banking operations in Hong Kong in 2000.
Since 2005, we have achieve several milestones with a number of strategic alliances
and acquisitions that will extend our customer or geographic reach and broaden our
product range.
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BUSINESS & STRATEGY
Our business
Listed on both the London Stock Exchange and the Hong Kong Stock
Exchange, Standard Chartered PLC is consistently ranked in the top 25 FTSE 100
companies by market capitalisation.
Personal Banking
Through our global network of over 1,750 branches and outlets, we offer
personal financial solutions to meet the needs of more than 14 million customers across
Asia, Africa and the Middle East.
SME Banking
Our SME Banking division offers a wide range of products and services to help small
and medium-sized enterprises manage the demands of a growing business.
Wholesale Banking
Headquartered in Singapore and London, with on-the-ground expertise that spans our
global network, our Wholesale Banking division provides corporate and institutional
clients with innovative solutions in trade finance, cash management, securities services,
foreign exchange and risk management, capital raising, and corporate finance.
Islamic Banking
Standard Chartered Saadiq's dedicated Islamic Banking team provides comprehensive
international banking services and a wide range of Shariah compliant financial products
that are based on Islamic values.
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Private Banking
Our Private Bank advisors and investment specialists provide customised solutions to
meet the unique needs and aspirations of high net worth clients.
At Standard Chartered our success is built on teamwork, partnership and the diversity of
our people.
At the heart of our values lie diversity and inclusion. They are a fundamental part of our
culture, and constitute a long-term priority in our aim to become the world's best
international bank.
Today we employ 75,000 people, representing 115 nationalities, and you'll find 60
nationalities among our 500 most senior leaders. We believe this diversity helps to fuel
creativity and innovation, supporting the development of exciting new products and
services for our customers worldwide.
Strategic intent
Brand promise
Values
• Responsive
• Trustworthy
• International
• Creative
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Approach
• Participation
• Competitive positioning
• Management Discipline
Continuously improving the way we work, balancing the pursuit of growth with
firm control of costs and risks
Commitment to stakeholders
• Customers
Passionate about our customers' success, delighting them with the quality of our
service
• Our People
• Communities
• Investors
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A distinctive investment delivering outstanding performance and superior
returns
• Regulators
Personal Banking
Arrange of features are included for the customers ranging from accounts to insurances
and investments needs. Following are the personal services provided by the Standard
Chartered Bank:
• Accounts
o Help me choose an account
o Term Deposits
o Savings Accounts
o access Plus Account
o Super Value Account
o Parivaar Account
o No Frills Account
o aaSaan Account
o 2-in-1 Account
o Depository Services
o Corporate Salary Account
o Current Accounts
o Business Plus Account
o Enhanced Business Plus Account
• Credit Cards
o Choose your Credit Card
o Emirates Platinum Card
o Platinum Card
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o Emirates Titanium Card
o Super Value Titanium Card
o Gold Card
o EMI Card
o Executive Card
o Classic Card
o Your Rewards Plus Program
o Special offers
o Fraud Protection
• Debit & Prepaid Cards
o Debit Cards
o Shop Smart Card
o Gold Debit Card
o Prepaid Cards
o Smart Travel
• Loans & Mortgages
o Personal Loans
o Home Loans
o Loan Against Securities
o Home Saver
o Loan Against Term Deposits
o Home Saver Plus
o Smart Credit Overdraft
o Loan Against Property
o Calculators
• NRI Banking
o Which account is right for me?
o NRE Account
o NRO Savings Account
o FCNR Account
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o Accounts for Returning Indians
• Exclusive Banking
o Excel Banking
o Priority Banking
o Private Banking
• Insurance & Investments
o General Insurance
o Life Insurance
o Investment Services
PRIVATE BANKING
Standard Chartered Bank has deep roots and a long heritage in international
banking. We have an extensive history in some of the world's most dynamic and fast-
growing markets, such as Asia and the Middle East. No one has a better understanding
of the wealth management needs of clients across these markets.
Standard Chartered—a financial services giant—has top credit ratings and a 150-
year history in banking, with a long-term commitment and financial investment in the
Private Bank. The Standard Chartered Private Bank offers a full range of customised
wealth management products and services, including those offered by our award-
winning commercial bank. We use a broad architecture approach to investment
management to bring you some of the world’s leading money managers and financial
products.
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Some key facts about Standard Chartered Bank:
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SME BANKING
SME Banking offers one of the widest range of banking products and services in the
market today. Managing a growing business demands most of your time and energy.
Our relationship managers understand your business requirement and help you manage
your business better.
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COMMERCIAL BANKING
Standard Chartered has maintained a long local presence, since 1858, with particular
emphasis on relationship banking. Significant networks have been established with
vendors and financial-related organisations to enable us to offer our customers a
comprehensive range of flexible financial services, with special focus on transactional
banking products. Supported by state-of-the-art operations, Standard Chartered is pro-
active in improving every part of our services. Electronic Delivery system has been put
in place to ensure that transactions are handled speedily. We have our Cash Product
Specialists and dedicated Customer Service Centres to provide our customers with
effective solutions. The currency of India is the Rupee (SWIFT code: INR).
Standard Chartered fully understands the importance of time, convenience and
efficiency to the success of your business. We make easy the complex financial world
for you and help you maximise every opportunity.
With over 140 years of experience in trade finance and an extensive international
branch network, Standard Chartered is committed to help you succeed in every
competitive environment. To keep pace with your changing needs, we will constantly
review our comprehensive cash, trade and treasury products and services, ensuring that
a full range of flexible and innovative services is always available for you wherever you
trade.
Please feel free to talk to us or email us on your business requirements and we can give
you innovative solutions to your banking needs.
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Cash Management
Our cash management services include local and cross border payments,
collections, information management, account services, liquidity management and
Payment Services
We can help you save time and money by reducing processing costs while
providing a value-added service to your suppliers.
We understand that most of your effort in the payment cycle is directed towards
initiation; difficulties in the subsequent reconciliation process can jeopardise the whole
process. With Straight2Bank Channels you can now track the exact status of each
payment through timely reports that can be uploaded seamlessly into your company’s
system.
• Cross-border payments
o Telegraphic transfers
o International bank cheques / drafts
• Domestic payments
o Local bank cheques / drafts / Cashiers order
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o Corporate cheque
o Direct credits – ACH / GIRO / credit vouchers
o Local bank transfers (RTGS)
o Book transfers (account transfer between Standard Chartered branches)
• Payroll
COLLECTION SERVICES
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• Receivables Management - ensuring receivables are collected in an efficient and
timely manner to optimise utilisation of funds
• Risk Management - ensuring effective management of debtors to eliminate risk
of returns and losses caused by defaulters and delayed payments
• Inventory Management - ensuring efficient and quick turnaround of inventory to
maximise returns
• Cost Management - reducing interest costs through optimal utilisation of funds.
Our solution
The Standard Chartered Collections Solution leverages the Bank's extensive
regional knowledge and widespread branch network across our key markets to
specially tailor solutions for your regional and local collection needs.
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Guaranteed credit
To help you manage your cash inflow from your accounts receivable more
efficiently, Standard Chartered can arrange for guaranteed (subject to prior
agreement) credit to your account for cheque collections. Your local and foreign
currency cheques will be credited to your account on a fixed date even if the Bank is
not in receipt of the funds from the clearing house or correspondent bank. The faster
availability of funds helps reduce overdraft balances and consequently lowers
interest costs.
Comprehensive MIS
We understand the importance of timely and accurate information
regarding accounts receivable to help you effectively manage your receivables and
debtors, and minimize losses caused by delayed receipts and defaults. You can also
better manage your buyers' requirements and improve your inventory management.
These reports are tailored to your needs and provide details such as invoice
number, drawer name, customer reference number, debtor code, special narration,
remarks and any other information you have requested for. Here are some of the
comprehensive reports the Standard Chartered solution provides you with:
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System integration
The Standard Chartered collections platform can be integrated with your
account receivables system to enable auto reconciliation for your account
receivables. You get fully reconciled receivables files with invoice details and
amounts matched against receipts.
Outsourcing of collections
Standard Chartered supports your complete collection cycle. These services cover:
• Courier pick-up service, which is available for cheques from your office, dealers'
and distributors' offices, from PO boxes etc.
• Reconciliation activities.
Types of collections
We provide collection services for:
• Direct Debits
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• Credit card collections
Please refer to the Standard Chartered individual country website to confirm the
availability of specific collections products and services.
LIQUIDITY MANAGEMENT
Our Solution
With our global experience and on-the-ground market knowledge, Standard
Chartered will help you define an overall cash management strategy which
incorporates a liquidity management solution that best meets your needs.
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Standard Chartered's liquidity management propositions
currencies
• Outsourcing
Clearing Services
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Our solution
Standard Chartered's international network and multi-currency capabilities are
well placed to provide you with a seamless service for all your clearing requirements
worldwide. Our network extends across Africa, the Middle East, South Asia, Latin
America, the USA and the UK. You can count on our over 150 years of on-the-ground
experience to tailor a clearing solution that meets your needs. Standard Chartered is a
correspondent banking partner you can trust to make this potentially complicated
process much easier for you
Standard Chartered offers "Best in Class" technology and processes in our clearing
services wherever you are, in whichever country you do business and in whatever
currency:
Emerging markets
If you are looking for a correspondent banking partner you can trust, Standard
Chartered can help you. We are in an excellent position to design the clearing service
that meets your needs. We have offices in every Asian country, with the exception of
North Korea – and with almost 150 years of on-the-ground experience, we make this
potentially complicated process much easier for you.
Asia Pacific
Standard Chartered's well established local franchise delivered throughout Asia
is well placed to meet your needs. We have offices in every Asian country with the
exception of North Korea.
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and euro clearing (which commenced in April 2003 and for which Standard Chartered
is the settlement agent) in Hong Kong.
• Consistent service levels – all our offices offering clearing services are ISO accredited
• Customised billing
If you are looking for a correspondent banking partner you can trust,
Standard Chartered can help you. We are in an excellent position to design the clearing
service that meets your needs. We have offices throughout the Middle-East and South
Asia and with almost 150 years of on-the-ground experience, we make this potentially
complicated process much easier for you.
• Consistent service levels – all our offices offering clearing services are ISO
accredited
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• Automated service delivery – inquiries / matching / cancellations; auto repair and
detailed STP reporting
• Customised billing
Africa
Standard Chartered is the experienced partner you can rely on to take care
of your African clearing requirements. You can entrust us with your clients' needs
throughout the region, offering them the same high level of service that they expect
from you. Africa is the latest region where Standard Chartered offers its clearing
services, complementing the coverage already provided in Asia, the Arabian Gulf, the
eurozone and the United States.Our wide clearing network in Africa is managed as one
business with a consistent approach to transactional services and service quality that is
unique in Africa. With over a hundred years' presence in many of our African
territories, our first-hand market knowledge of local business practices enables us to
handle your transactions with confidence and expertise, in some of the most challenging
banking environments.
• Consistency of services
• Market knowledge
• Customer service
• Local reputation
USD clearing
The U.S. Dollar is the primary currency for the settlement of foreign exchange and
international trade transactions. With evolving changes in the marketplace, you need
partners who are responsive to your growing needs and who can execute your
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transactions quickly and effectively. Standard Chartered can help give you the support
you need to grow your business successfully.
Providing quick and reliable clearing is one of our core competencies. We can help
improve your international transactions, allowing you to free up your time to focus on
your clients' needs. We understand the clearing process clearly and have the
infrastructure and expertise to help you with your U.S. dollar clearing requirements
around the world. Our operations are highly automated to ensure that your transactions
are completed reliably, efficiently and securely.
With a comprehensive range of U.S. dollar clearing services and corresponding reports
available, we can tailor products to suit your specific needs so that you can operate
more efficiently and effectively. Automated payments using SWIFT, detailed reporting
and simplified billing are all designed to streamline your Clearing process and improve
liquidity. These are some of the key features and benefits of our USD clearing services.
At Standard Chartered, we have the resources, skills and expertise to take care of your
Clearing concerns, while you focus on looking after your clients.
Key features
Standard Chartered understands how to meet your needs for a smooth and efficient U.S.
dollar clearing service. One of the first foreign banks to be invited to join the Clearing
House Interbank Payments System (CHIPS), Standard Chartered is a major U.S. dollar
clearing provider. Standard Chartered understands the markets where we do business,
our clients' needs and the rapid changes affecting the U.S. dollar clearing business.
Our network, expertise and technology enable you to resolve your clients' clearing
requirements promptly and efficiently.
Automated payments
Our payment process is highly automated, making use of electronic transfer technology
which reduces errors, enhances processing times and minimises costs -completing the
clearing process with maximum speed and efficiency.
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Value-added reporting
We offer comprehensive reporting on balances and transaction activities. With this
information, you will be better able to track transactions, oversee the reconciliation
process and analyse usage patterns. Full reporting is also available through our
electronic delivery channels including the internet. Our extensive management
information systems provide you with clear and timely information to help you facilitate
your management decisions and simplify reconciliation. At Standard Chartered, our vast
range of tailor-made reporting capabilities satisfies all your record-keeping needs.
Billing
We understand your need for a simple and transparent billing system. We offer
innovative pricing structures that enable you to remain competitive. As such, you will
find that our billing covers tiered pricing, volume rates as well as standard fees and
services.
Customer service
No matter which part of the world you are conducting business from, we have dedicated
multilingual customer service staff to attend to your enquiries. Our numerous ISO 9002
certificates earned around the world demonstrate our commitment to excellence in
service delivery. For your added convenience, we have an 18-hour payment and inquiry
processing service, which enables us to respond quickly to your needs. The information
you need is always at your fingertips.
Technology
At Standard Chartered, we consistently invest in innovation, upgrading our technology
to guarantee that our services meet your needs. Our state-of-the-art technology and
interfaces make the clearing process quick, secure and efficient. We also supply a PC-
based automated search system for locating CHIPS and SWIFT codes to assist you in
creating straight-through payments for your added efficiency.
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LIQUIDITY MANAGEMENT
We offer an array of products and investment sweeping vehicles to allow for
maximisation of your USD account balances that can be tailored to your specific
requirements.
Key benefits
Standard Chartered has been operating in the US for over 100 years. Our in-depth
experience and thorough understanding of clearing services enable us to offer you a
consistently high level of quality service. While there are a number of banks offering
U.S. dollar clearing facilities, you will find that Standard Chartered's tailored approach
and expertise can give you and your clients a value added clearing service.
We have the skills, expertise and experience to deliver value-added solutions to help
you achieve better business results.
Prior to 1999, SCB was an existing member of the old ECU clearing system, having
been a founder member of the EBA. As such we have excellent first hand experience of
a pan-European cross-border payment environment. The introduction of the euro allows
access to all European Union countries on a Same Day basis. Regardless of the fact that
the UK is not one of the original members of EMU, UK banks, including SCB, can
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offer euro accounts and make payments in exactly the same manner as any other of the
15 European Union member banks.
CHAPS Membership
SCB is one of the 20 full settlement members of CHAPS Euro, the UK's
domestic euro clearing system that is connected to TARGET.
TARGET Access
Through CHAPS Euro, Standard Chartered Bank has direct access via the Bank of
England to TARGET (the Trans-European Automated Real-time Gross settlement
Express Transfer system), which links the European Central Bank with the national
central banks of the 15 EU countries. Through TARGET, the system links together the
domestic Real Time Gross Settlement (RTGS) systems in each of the EU countries for
those transactions where the beneficiary requires immediate finality of payment.
TARGET has common operating times throughout the European Union for customer
and inter-bank payments.
EBA Membership
The Euro Banking Association operates the Euro1 Clearing System, which works on an
end-of-day net settlement basis. SCB has been a clearing member of the EBA since its
launch, and is able to make euro payments via the Euro1 Clearing System for
transactions of any value.
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settlement risk from the current foreign currency settlement processes and to provide a
mechanism for containing any systemic risk arising from the failure of a major market
participant.
How it operates
CLS has already changed the way banks conduct and settle their FX settlement
business. For the first time, it introduces, 'payment-versus-payment' (PvP) into the
foreign exchange settlement process.
The CLS Bank (CLSB) provides the necessary account structure and mechanism
through which the separate payment legs of an eligible foreign exchange trade are
simultaneously exchanged (using a payment-versus-payment process), thus eliminating
the associated settlement risk. Similarly, all funding obligations are discharged by the
use of an overlapping window for the RTGS systems in the CLS countries.
CLS started with seven currencies – AUD, CAD, CHF, EUR, GBP, JPY and USD, but
during this year the three non-Euro Scandinavian currencies will be added, as well as
the Singapore Dollar.
CLS is expected to extend its reach thereafter, adding new currencies, and an increasing
number of participants through an expansion of third party services, whereby non-
settlement members of CLS may access the benefits of the system, without incurring the
start-up costs.
GATEWAY BANKING
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When was the last time you were offered a continent and more?
Need to expand your network to support your clients? Standard Chartered’s Gateway
Banking makes all the right connections.
You gain: Broader client relationships, client retention and the ability to support your
clients wherever they want to go in Asia and the Middle East.
Global trends
Corporations that were once focusing only on domestic markets are now going
international. Your clients, who once only dealt with suppliers and customers in your
network territory, now deal with trading partners in dozens of countries around the
world, especially in the high-growth, resource-rich zones of Asia, Africa and the Middle
East.
Your challenges
As your clients grow their businesses and expand their footprints, they look to you to do
the same. With only a domestic or regional presence, how do you:
• Support your clients in regions where you do not have anetwork footprint?
• Broaden and deepen your existing customer relationships?
• Attract new business by participating in global RFPs?
• Defend your client base from international competitors?
Finally, how do you do all of the above without being distracted from your domestic
capabilities and core competencies?
45
We have the answer
Standard Chartered’s Gateway Banking programme gives your network an immediate
extension into the most active regions on the global trade map. Today, our programme
delivers premium services in:
• Bahrain • Jordan
• South Korea
• Bangladesh • Malaysia
• Sri Lanka
• China • Pakistan
• Taiwan
• Hong Kong • Philippines
• Thailand
• India • Qatar
Everyone’s a winner
By entering into a strategic relationship, you get an immediate competitive
edge without undertaking a significant investment. Standard Chartered’s Gateway
Banking programme offers you and your corporate clients convenient and easy access
to our indepth knowledge and experience of Asia, Africa and the Middle East. Your
customers immediately benefit from access to a large international branch network and
product capabilities including cash management, trade finance, foreign exchange and
credit facilities.
An integrated client service model provides flexibility. Working with you we ensure
that your customers receive the consistent service quality and support they have come to
expect from you. A full spectrum of options is available from a straight forward client
referral to a comprehensive integration of electronic channels. Ranging from MT940
and MT101 message exchange to full host-to-host integration of banking systems, the
46
service model allowsan expansive fulfillment of transaction banking requirements with
potential for a single point of transaction initiation and reporting view. Our harmonized
account documentation makes the set-up process easy and web-based electronic access
makes banking simple, allowing your customers to transact locally with suppliers and
buyers in their business markets.
47
industry has presented promising prospects for the coming future. The transition has
also resulted into introduction of ample opportunities for the professionals including
Chartered Accountants.
The Indian Insurance industry is featured by the attributes:
♣ Low market penetration;
♣ Ever-growing middle class component in population.
♣ Growth of consumer movement with an increasing demand for better insurance
products;
♣ Inadequate application of information technology for business.
♣ Adequate fillip from the Government in the form of tax incentives to the insured, etc.
The industry formations need to keep vigil on these characteristics of the Indian market
and formulate their strategies to entail maximum contribution to the output of the sector.
The Indian life and non-life insurance business accounted for merely 0.42 percent of
the world's life and non-life business in 1997. The figures of the basic parameters of the
industry's performance viz. Insurance Density and Insurance Penetration also are
evident of the hitherto existing low-yield Indian market conditions.
The term "Insurance Penetration" broadly measures the contribution of the insurance
industry in relation to a nation's entire economic productivity. The figure of premium
vis-à-vis the GDP of 1999 stood at 0.54 percent for non-life insurance business and 1.39
percent for the life insurance business. The term "Insurance Density" reflects the
Insurance purchasing power. The premium per capita in India amounted to US $ 2.40
for non-life insurance and US $ 6.10 for life insurance in 1999 but with the deregulation
of the sector, a sea change in the scene is most likely
The insurance sector in India has come a full circle from being an open competitive
market to nationalisation and back to a liberalized market again. Tracing the
developments in the Indian insurance sector reveals the 360-degree turn witnessed over
a period of almost two centuries.
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CHAPTER IV
REVIEW OF LITERATURE
49
WEB-BASED CASH MANAGEMENT
Built on new-generation industry standard technologies J2EE and .NET, the modular
solution provides corporate customers anytime, anywhere access to real-time
consolidated information. It manages cash positions and electronically sends and
receives funds in a secure
Key Offerings
Additional Features
• Alerts
• Infrastructure
• Security
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Corporate Cash Management to benefit from Electronic Payments
The new electronic payment products and services offer the corporate
clients an improved bottom line by helping manage cash requirements. It helps
corporate to make the best use of their funds and provides an effective means of
managing their financial requirements.
Several of the trends in cash flow forecasting favor the use of electronic
payment products like RTGS, Electronic Funds Transfer (EFT) and card payments.
Improved technology and systems integration makes it more attractive to use
electronic payment products because these methods of payment can be incorporated
into firm-wide computing systems.
Electronic payments and cards provide control over incoming funds, and
allow companies to limit access to these funds to authorized parties. In addition,
limiting corporate purchases to electronic payments makes it easier for firms to
monitor cash outflows and prevent unauthorized expenditures, because these
payments are easier to document and provide an audit trail.
From the perspective of a Corporate, the electronic payment systems ensure speed
and security of the transaction processing chain, from verification and authorisation
to clearing and settlement. Also it gives a great deal of freedom from more costly
labor, materials, and accounting services that are required in paper-based processing,
better management of cash flow, inventory, and financial planning due to swift bank
payments.
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another's business, Linking of electronic payment systems like RTGS, EFT, NEFT,
SWIFT etc in cash management etc. Banknet will also release results of “Bank
Customer Survey on Payment Systems” at the conference
Business Benefits
Generation of Fee-based Income
Business Agility
Built on industry standard platforms J2EE and .NET, the solution provides
banks with tremendous flexibility to extend their product portfolio and customize the
solution according to requirements. The architecture of the solution enables the bank to
write business rules once and deploy anywhere, add new rules, modify existing ones or
integrate with other applications seamlessly. The solution also provides an additional
layer that can be extended to interface with multiple back office systems. All this
enhances agility of operations, helping the bank identify new opportunities and roll out
new products.
Cost Savings
Thin-client architecture over the Internet reduces the cost of maintenance
associated with frequent upgrades and support. The deployment of Finacle enables a
cost-effective channel through which to serve customers. As the number of transactions
completed on-line increases, the number of more expensive branch transactions
decreases. This is especially true of small business customers who tend to use the
branch as their primary channel. Greater automation and productivity, as well as
reduced human error, further lead to increased cost savings.
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Increased Customer Satisfaction
The self-service capabilities empower corporate customers to manage the
solution in terms of defining user-permissions, based on hierarchy and roles. This leads
to greater convenience and offer better monitoring of banking transactions in real time.
A more empowering corporate client would be a more satisfied and profitable customer.
If you haven't considered cash management an important issue, then you're probably
undermining your business's short-term stability and its long-term survival. But how can
you manage business cash better?
Start with understanding how good cash-management practices can influence your
company's growth and survival by reading "The Art of Cash Management," Inc Finance
Editor Jill Andresky Fraser's classic article on the topic. Then dive into forecasting your
business-cash needs and learning how to handle a cash crisis. Assembled here are
practical pieces of advice, tips and tricks from CEOs, and tools that you can use to get a
handle on business cash.
53
The Magic Number
Every business has a magic number. By employing his, our columnist didn't
overstaff this year.
Riding the Economic Roller Coaster
Tighten your seatbelt. Surviving the ups and downs of the world economy
means keeping an eye on business finances.
When a Cash Crisis Strikes
Credibility with vendors, bankers, and other creditors is built slowly, but can be
destroyed quickly if your company falls behind on payments. Know how to
break the bad news to preserve your business's relationships.
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Breaking Free from Budgets
Exasperated by budgets that hamstring creativity, a growing number of
companies are tossing off financial constraints--and still holding the line on
spending.
Budgeting for Blunders
Lisa Hickey created a fund to support creative risks her Boston-based ad agency,
Velocity Inc., takes when trying innovative ideas that might not pan out.
A Passion for Forecasting
Don't put together an annual sales forecast using only gut instinct and wishful
thinking! Here are some rules you can follow to create a forecast that you and
your employees can count on.
TOOLS
Defining Key Financial Ratios
Tracking these key financial ratios will highlight financial trends in your
business.
Financial Ratio Worksheets
Use these financial-ratio worksheets to determine 10 key ratios and track
financial trends in your business.
A Simple Formula
Determine your breakeven point with this online calculator.
The Employee-Run-Budget Worksheet
Help employees get in on the budgeting act with this worksheet.
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Profit-and-Loss Projection
Use this profit-and-loss projection as a guide to projecting your company's
profitability.
There are, of course, many ways to improve and re-engineer the processes.
However, depending on budgets and also to minimise disturbances to the business, the
following are the suggested simple and initial steps. Note that the larger the corporation,
the more involved the process will be.
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There must be a true desire and commitment to improve and make changes for
the better; however, the process should be evolutionary and practical. Take care to
ensure goals are not artificially set for easy attainment nor established for ideal
perfection so to be unreachable or unrealistic. The goals should be at a higher level than
where the company is now and the initial level of improvement. For example, a goal
may be to achieve costs savings and efficiency gains on the process of collecting
revenues and reconciling with the accounts receivable system.
(6) Establish and commit to specific initiatives, sequence and timeframe:
Action points, initiatives and a realistic time frame must be decided for
achieving each initiative. Communicate these to the providers. For example, an
initiative may include automating and outsourcing vendor payments.
(7) Obtain simple written proposals from the shortlisted potential providers:
Have providers present proposals and be prepared to ask questions and probe
exactly what is being offered and whether the proposed solution, services and products
meet your objectives. Look for comprehensive, well thought-out and realistic solutions.
(8) Decide on the solution and decide on a provider(s):
It is not necessary to have only one provider of services. For example, there
could be a domestic collection bank and a regional account management bank.
Document all goals and services as well as pricing and the period the pricing covers,
such as one-year or two-year, and the start dates.
(9) Review the internal project team and add actual users to help implement the
proposed changes:
This process is to help obtain commitment from the bottom up and to gain the
buy in of internal users. The bank provider(s) should also have a parallel team to work
with your implementation or project team. Also, a mutually designed and agreed
schedule and action plan should be established.
(10) Review, establish and commit to a process for ongoing improvement:
Services should be reviewed once implemented to ensure that the high-level
goals and objectives are obtained. There should also be an ongoing emphasis on
improvement, and a culture for empowering staff to recommend and look for ways and
means to improve cash management services and processes.
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Protecting Yourself from Fraud
58
How can I protect myself from these scams?
If you receive an e-mail that warns you, with little or no notice, that an account of yours
will be shut down unless you confirm your billing information, do not reply or click on
the link in the e-mail. Instead, contact the company cited in the e-mail by a telephone
number or Web site address you know to be genuine. (Note: Merrill Lynch will not ask
a client to send sensitive personal information via non-secure e-mail.)
If someone calls about a potential attempt at credit card theft, hang up and call back,
using the phone number on the back of your credit card. Do not share any personal
information over the phone with an unsolicited caller.
Keeping your operating funds working for your company is crucial to maintaining
healthy cash flow and maximizing your financial return. Investing idle funds wisely
may help you to generate income from your working capital, increasing your yields
while maintaining liquidity.
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Concentrate on maximizing after-tax returns
If your company is in a lower tax bracket, focus on higher yields rather than
tax advantages; however, if your federal tax bracket is high, you may be able to obtain a
better after-tax return by investing in federally tax-exempt securities. It's important to
compare the yields on tax-free obligations to their fully taxed equivalents to find those
that provide a higher after-tax return. The tax benefits of some investments may depend
on your business structure.1
Investing funds for longer terms typically means higher yields. If your business
keeps its cash highly liquid, perhaps in a money market fund, when only a portion is
needed for daily operating expenses, you may well be sacrificing some yield.
Determine how much you can commit for a longer period. By investing that amount for
as little as 90 days, you may be able to earn extra return. Also consider intermediate-
term investments with maturities from one to three years. If your business is building
cash reserves for an expansion, an acquisition or new machinery, you may be able to
invest those funds for a year or two.
The potential for additional yield might warrant assuming some moderate
investment risk. Newly issued obligations guaranteed by the U.S. government (such as
Treasury bills) yield less than securities lacking that guarantee. You may be able to
obtain a higher yield with high-quality investment-grade corporate obligations.
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analyses of the risk levels of various instruments. If you choose bonds with short
maturities, you may want to consider an A-rated bond by S&P. This type of bond is
likely to yield a higher return than an AAA-rated bond (S&P’s highest investment
rating) of equal maturity. You should, however, be comfortable with the incremental
risk associated with lesser quality credits.
Healthy cash flow is essential to the success of a small business. You may
have the best service or product around, your employees and customers may love you,
your office may be well organized, but if you don’t have the money to buy inventory or
pay bills, you can’t keep your business running. Many business owners make the
mistake of believing cash flow is largely out of their control. On the contrary, the
following steps can really help.
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liquidity, the health of your cash flow, your average collection period, the
appropriateness of your collection terms and your inventory turnover rate.
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4. Invest surplus cash
Although part of your business capital needs to be liquid, most businesses
have some capital that can be invested in short- and intermediate-term securities for
potentially higher yields. A broad array of investments can be purchased within a
central asset account. And you can sell securities in your account at any time, or, if
appropriate, borrow against their value2, to meet working capital needs. Be sure to
discuss the risks of borrowing against your securities with your Business Financial
Advisor.
Today’s business environment changes rapidly, and as a business owner, you need to
regularly review your cash flow and cash management policies to ensure that they are
helping to keep your business competitive.
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CHAPTER-V
DATA ANALYSIS
&
INTERPRETATION
64
RESULT AND ANALYSIS
sevices?
(a) Yes
(b) No
Yes
No
Its very good for the standard chartered bank as most of the companies are aware of the
cash management services provided by the bank. The bank can look into companies as
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2. In which company bank do you have your account?
Axis Bank
SCB
HSBC
BOI
From the above diagram it can be easily inferred that standard chartered bank is
facing neck to neck competition from HSBC Bank and it should keep on improving
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3. Does the financial crisis in US affecting your functioning here in
INDIA?
(a) Yes
(b) No
Yes
No
From the pie chart its quite evident that the financial crisis in US are
affecting people globally and even insurance companies are gravely affected
by the crisis.
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4. Are you satisfy with your company services?
(a) Yes
(b) No
Yes
No
From the above analysis it can be interpreted that most of the companies were satisfied
by there CMS provider but still they found few areas of improvement SCB can give
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5. What are your main modes of premium collection.
(a) Cash
(b) Cheque
Cash
Cheque
DD
Most of the companies accept premium in the form of cheque as it’s a safer
instrument than cash and is easily handled as compared to demand draft Standard
Chartered Bank can provide various cheque collections options to the companies.
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6. Do you have centralized or decentralized?
(a) Centralized
(b) Decentralized
Centralised
Decntralised
Most of the companies aspire to become centralized as they want to have all the
cash balances at there main branch at the end of the day as it saves a lot of time
and money Standard Chartered Bank can offer the services of there new E-
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7. Do you accept premium through credit cards
(a) Yes
(b) No
Yes
No
Most of the insurance companies are planning to introduce this new facility as of
now not many companies have started with this concept but sure are panning in
near future.
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8. What are your main modes making payments
(a) Cheque
(b) Cash
(c) DD
Cash
Cheque
DD
Like premium most of the companies distribute their payments through cheques
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9. Do you reinsure your polices
(a) Yes
(b) No
Yes
No
Most of the companies re-insure themselves from one another or by a re-insurer it helps
them to reduce risk on there part Standard Chartered Bank can look into to the
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CASE STUDY (STANDARD CHARTERD BANK)
GROUND REALITIES:
The ABC Ltd. is a FMCG Company. The company has presence in more than
15 cities and have its head quarter in Mumbai. The company has Depots at these cities.
And each depots has some turnover every month. The name of Cities, the monthly turn
over of the each depots and no. Of retailers in each cities are as follows:
(Rs. In Crore)
1 Mumbai 1.5 200
2 Delhi 1.25 180
3 Calcutta 1.00 175
4 Madras 0.75 180
5 Ahmedabad 0.75 150
6 Banglore 0.70 160
7 Hyderabad 1.00 155
8 Pune 0.50 140
9 Jaipur 0.60 150
10 Indore 0.75 120
11 Cochin 0.50 130
12 Agra 0.50 120
13 Jalandhar 0.40 110
14 Jammu 0.10 115
15 Nagpur 0.10 135
16 Lucknow 0.10 140
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• Location
• Cheque number
• Cheque amount
• Date of deposit
• Clearing date
• Retailer name/code
• Returned cheques
Date
Reason
Location
Amount
ANALYZING PROCESS:
These are the conditions and facts of the organization. Now, what the bank will do? I
have taken the case of STANDARD CHARTERED BANK CMS. This is regarding
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The STANDARD CHARETERED BANK will analyses the location of the
company. The ABC Ltd. have sixteen locations in the country. This is not always
possible to have the branches at each location of the client for the banks. In this case,
• In 2 locations of the company, the bank has tie-up with correspondent bank
• And in remaining 4 locations, the bank has no presence as well as no tie-up with any
other bank.
LCC are the cheques, which are drawn and deposited at the same location. Eg.
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The LCC is again categorised into two types:
1) LCC BRN:
A local Cheque which is drawn and deposited at the same location where the bank
2) LCC COR:
A local Cheque which is drawn and deposited at the same location where the bank
doesn’t have its own presence but has tie up with correspondent Bank.
The UCC are the cheques, which are drawn and deposited at different locations.
1) UCC BRN:
2) UCC COR:
3) UCC ONW:
location where the bank neither have its own presence nor have tie-up with
correspondent bank.
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PRICING:
Pricing is competitive; varies from centre to center. It also varies from instruments to
instruments.
Special pricing can be worked out taking into account the volume of funds & the
centres. The pricing part of the CMS is very complex. Normally, the STANDARD
CHARTERED bank takes into account the following factors while going for pricing:
When Cheque is deposited in the bank it passes through the clearing house. In India,
clearing is done through RBI, SBI and PSU banks. The RBI has presence in 15
cities in India while SBI has 938 locations in India including its associates. other
cities where clearing house is not there, the clearing is done through Correspondent
Suppose I deposit the Cheque on day 0, then the time taken by the clearing houses
to debit the bank account would be different. The SCB has to debit its customer’s
In this case, the bank charges interest on the money which it gives in form of
Correspondent bank, the bank has to pay extra charges to these banks.
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2) Overheads:
The bank takes into account the o/hs charges, which it occurs in the process. The
3) Margin:
After including the transaction and other o/hs charges, the bank gets the cost of
transaction. On this the bank adds its margin for being in the business.
In pricing, other elements like courier charges, return cheques etc. also considered.
Pricing in CMS in generally negotiable between the company and the Bank.
• Debit Transfers
• Customised Reports
Benefits to Customers:
79
• Cost reduction
• Enhanced Liquidity
80
CHAPTER-VI
FINDINGS & SUGGESTIONS
81
FINDINGS & SUGGESTIONS
We suggest following measures, which Standard chartered Bank could take so as to take
services we provide. But the fact is, India being a price sensitive market;
people at times go for monetary benefits rather than for long-term non-
monetary benefits.
customized, so that services are provided to only those customers who are
willing to pay the price for services they are getting and let the other
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• SCB should provide competitive prices as nowadays a lot business is being
acquired by AXIS bank and HSBC bank and SCB is facing a lot competition
• SCB should contact with their clients regularly for knowing the problems
faced by them. This will help SCB in providing best services to customers.
to handle all the needs of the client as the clients here are big corporate
giants.
• SCB should focus on getting the business other business clients other than its
opportunities.
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CONCLUSION
The study allowed us get answers regarding the service awareness among people and
the problems it faces. The key findings and analysis of the survey shoed the following
• A large number of clients and customers call the branch frequently to handle
banking issues , this shows the keenness of the customers to call the branch for
almost every small issue. The service Straight2bank does provide an answer to
• The service provided by staright2bank does offer the main requirements of the
• All the respondents wanted to carry out the banking needs at their convenience.
This means the service caters the banking needs that customers generally require
and its main benefit of banking while sitting at office is desired by one and all,
thereby proving that the service does have the potential usage.
• Few of the respondents were aware about the service which was desired by
100% respondents clearly showing that there has been a falter in its promotion
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• Customers were not aware that the service was a free one, this is clear that
almost all the attributes of the services are favorable to the customers still
customers are not using the service and are not even aware of it.
• Almost all customers once educated about the service readily enrolled for it
whereas a mere portion did not trust the bank and thought that the bank would
have some hidden charges that they are not putting forward
Many clients who enrolled for the staright2bank service would have problems
using it as the drop boxes are not strategically placed many areas do not even
have drop box facility; Standard chaetered Bank must look into the policies of
installing the drop box. They should assign it to the regional office or allow
branches to put up boxes where the branch thinks it would be optimally utilized
no matter which area of the city as of now that branches are allowed to put up
drop boxes in a radius which falls in close by areas to the branch. A customer
who lives close by to the branch would not use this service whereas customers
who are far of require the service, however the branch cannot provide them with
the facility as they cannot install the boxes in that area and it is the duty of the
local branch of that area to put up boxes which is not happening they hardly
85
CHAPTER VII
BIBILOGRAPHY
86
REFERENCES
Authors:
WEBSITE
• www.scb.com
• www.scb.co.in
• www.hsbc.co.in
• www.hsbc.com
of the concept
• www.inc.com
• www.treasurymanagement.com
• www.business.ml.com
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